By FXEmpire.com

Introduction: News from the Euro and Swiss zone. EUR/CHF is frequently chosen for carry trades which involves going long a high-yielding currency (EURO – 3.50%) against a low-yielding one (CHF – 1.50%). Traders earn daily interest fees when holding this pair long (rollover fees).

  • The interest rate differential between the European Bank(ECB) and the Swiss National Bank(SNB)
  • Swiss and Euro zone fundamentals

Weekly Analysis and Recommendations:

The EUR/CHF ended the week it the same trading zone that it has been since April 6, 2012. With the euro hitting record lows there is no place for it to fall with the SNB floor. Markets are currently in risk aversion mode, with the JPY and USD hitting new highs. The Dollar Index has been trading well over .83.

Market sentiment remains negative towards the euro, but contagion is also affecting all European markets.

Date

Last

Open

High

Low

Change %

Jun 01, 2012

1.2012

1.2011

1.2014

1.2007

0.01%

May 31, 2012

1.2011

1.2012

1.2021

1.2009

-0.01%

May 30, 2012

1.2012

1.2011

1.2014

1.2008

0.01%

May 29, 2012

1.2011

1.2020

1.2025

1.2009

-0.08%

May 28, 2012

1.2021

1.2019

1.2032

1.2014

0.02%

With Greece, Spain and Italy looking like train wrecks in motion, and the lack of leadership and direction from the EU and the quibbling between politicians and bankers, investors are dumping everything associated with the eurozone.

On Friday, investors also gave up on the US recovery after the Nonfarm payroll report showed that the US had only created 69,000 jobs and that unemployment had risen to 8.2%. The USD lost a bit of strength allowing the euro to pick up temporarily.

Switzerland’s eco data was also fairly negative with under forecast retail sales and PMI.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Major Economic Events for the week of May 28- June 1 actual v. forecast for Euro, GPB, and the Franc

Time

Cur.

Event

Actual

Forecast

Previous

Tuesday, May 29

06:00

GBP

CBI Distributive Trades Survey

21

-7

-6

Wednesday, May 30

03:00

CHF

KOF Leading Indicators

0.81

0.48

0.43

Thursday, May 31

01:45

CHF

GDP (QoQ)

0.7%

0.1%

0.5%

02:00

GBP

Nationwide HPI (MoM)

0.3%

0.2%

-0.3%

05:00

EUR

CPI (YoY)

2.4%

2.5%

2.6%

Friday, June 01

03:15

CHF

Retail Sales (YoY)

0.1%

2.0%

4.7%

03:30

CHF

SVME PMI

45.4

46.4

46.9

04:00

EUR

Manufacturing PMI

45.1

45.0

45.0

04:30

GBP

Manufacturing PMI

45.9

49.7

50.2

05:00

EUR

Unemployment Rate

11.0%

11.0%

11.0%

Historical:

Highest: 1.5193 CHF on Oct 10, 2009.

Average: 1.3271 CHF over this period.

Lowest: 1.0083 CHF on Aug 9, 2011.

Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD

Date

Time

Currency

Forecast

Previous

Jun 5

9:00

EUR

Retail Sales m/m

0.3%

10:00

EUR

German Factory Orders m/m

2.2%

14:00

USD

ISM Non-Manufacturing PMI

53.5

Jun 6

6th-8th

GBP

Halifax HPI m/m

8:30

GBP

Construction PMI

55.8

10:00

EUR

German Industrial Production m/m

2.8%

12:30

EUR

ECB Press Conference

12:30

USD

Revised Nonfarm Productivity q/q

-0.5%

14:30

USD

Crude Oil Inventories

18:00

USD

Beige Book

23:01

GBP

BRC Retail Sales Monitor y/y

-3.3%

Jun 7

7:00

CHF

Foreign Currency Reserves

235.6B

7:15

CHF

CPI m/m

0.1%

8:30

GBP

Services PMI

53.3

11:00

GBP

Asset Purchase Facility

325B

11:00

GBP

Official Bank Rate

0.50%

0.50%

TBD

GBP

MPC Rate Statement

12:30

USD

Unemployment Claims

383K

14:00

USD

Fed Chairman Bernanke Testifies

Jun 8

8:30

GBP

PPI Input m/m

-1.5%

8:30

GBP

Consumer Inflation Expectations

3.5%

12:30

USD

Trade Balance

-51.8B

14:00

USD

Fed Chairman Bernanke Testifies

Click here to read EUR/CHF Technical Analysis.

Originally posted here